Data on housing construction in the United States is expected this Friday, as well as public comments from several Federal Reserve officials.
The apathy in global economic indicators is fueling concerns about the future economic outlook, although it also suggests that central banks could be gaining ground in their fight against rising prices.
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The closing of the financial week leaves to the dollar in one of its worst streaks against the main currencies, while the Japanese yen consolidates due to growing concerns about the global economic slowdown.
US inflation data released on Tuesday, which came in below expectations, readjusts market projections for how quickly the Federal Reserve will reduce interest rates. This event has a downward impact on the dollar, taking it to a weekly decline of 1.6%, thus marking one of its biggest falls since mid-July.
The dollar index declines 0.2%, reaching 104.14 units, while the euro registered an increase of 0.1% reaching 1.08615 dollars. These movements come after reports confirming an abrupt slowdown in year-on-year inflation in the European bloc during October.
Dollar vs. other currencies
In the case of the yen, a currency that has faced prolonged depreciation against the dollar, it is strengthening, surpassing the barrier of 150 units per dollar for the first time in almost two weeks. The US dollar lost 0.9%, trading at 149.32 yen.
Lee Hardman, currency analyst at MUFG, points out that the yen’s strength reflects increasing global concern about a possible contraction in economic growth. He adds that the Japanese currency is less impacted by the decline in energy prices.
The unfavorable data on retail sales in the United Kingdom, released this Friday and below expectations, adds to a series of negative indicators throughout the week. This causes the British pound to trade virtually unchanged at $1.24230.
The apathy in global economic indicators is fueling concerns about the future economic outlook, although it also suggests that central banks could be gaining ground in their fight against rising prices.
Data on U.S. housing construction, along with public comments from several Federal Reserve officials, are expected this Friday, which could provide more clarity on the direction of monetary policies in the near future.
Source: Ambito
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